Interpol partners with African Development Bank on anti-corruption enforcement

The AfDB, which focuses on development funding in Africa and deploys approx. $10 billion annually, is the first major multilateral development bank (MDB) to partner with the world’s largest policing organisation.

The bank’s existing integrity and anti-corruption department, the PIAC, is already well established with mechanisms to sanction parties found to have engaged in wrongdoing, but these sanctions do not equate to criminal convictions or punishments and instead can result in being debarred from bank funded work and, in certain circumstances, cross-debarment by signatories to the Agreement on Mutual Enforcement, including the World Bank and Asian Development Bank.

Edward James, an expert in corporate crime risk at Pinsent Masons, said: “Companies facing an investigation by the PIAC should take the process seriously.”

“The burden of proof is on a balance of probabilities and the way the bank defines misconduct, like a fraudulent practice, is quite wide,” he said. 

“Whilst the bank cannot make a determination on criminal guilt, the consequences can still be financially devastating for companies that rely on bank funded work, particularly construction firms that focus on building infrastructure projects.”

AfDB and Interpol will focus on sharing expertise, enhancing the bank’s investigative capabilities and developing preventative measures against financial crimes, including counter-terrorism financing, cybercrime and anti-corruption measures.

James said: “The AfDB may share evidence gathered with local police in the countries impacted by an investigation. In the past, not many of these cases have evolved into criminal investigations and prosecutions, but with the new partnership formalised, that may change.”

“The increased criminal enforcement risk means that companies that face PIAC investigations should ensure that their interests are properly protected or they may face the risk of criminal investigations and prosecutions,” he said. 

“Whilst good faith cooperation during an investigation may be the best route to adopt, companies should ensure that they have proper guidance and advice from experts who can help navigate not only the direct risk of the PIAC investigation but also the potential criminal risk that may follow.”

The PIAC’s most recent annual report in 2023 stated it closed 44 investigations during the previous year. Of these investigations, 31 related to alleged fraudulent practices and seven related to alleged corrupt practices.

Whilst there may be a pause on anti-corruption enforcement of the Foreign Corrupt Practices Act by the US based on president Donald Trump’s February 10 executive order, there is currently no pause in enforcement by the PIAC, which remains focused on ensuring AfDB funded projects are not tainted by fraud or corruption.